LONDON (Reuters) - Portuguese utility company EDP announced plans to sell 2 billion euros’ ($2.3 billion) worth of assets in Portugal and Spain, and raise another 4 billion euros via an asset rotation program until 2022 to fund its expansion in renewable energy.

FILE PHOTO: The logo of Portuguese utility company EDP - Energias de Portugal is seen at the company's offices in Oviedo, Spain, May 14, 2018. REUTERS/Eloy Alonso

EDP-Energias de Portugal is the target of a 9 billion euro takeover proposal by China Three Gorges (CTG), which the EDP board has rejected as too low and which is opposed by activist shareholder Elliott Advisors.

In a strategic update on Tuesday EDP also earmarked 12 billion euros for capital expenditure between 2019 and 2022, with 75 percent of that to be spent in North America and Europe, CEO Antonio Mexia told investors and analysts during a presentation in London.

“If the opportunity is there we can do more than the 2 billion euros” in asset sales, Mexia said.

The sale of the Portuguese assets reflects some of the demands by activist investor Elliott, which has launched a campaign to try to thwart CTG’s takeover proposal, but the “portfolio optimization” asset sale plan is somewhat below the 7.6 billion euros proposed by the shareholder.

The 12 billion euros EDP has earmarked for investment, however, appears to go beyond that proposed by Elliott as the utility hopes to add 7 gigawatts of renewable power capacity globally, as well as some transmission projects in Brazil, where it plans to retain its overall exposure and could even expand.

As well as calling for the sale of Iberian thermal holdings and minority stakes in Spanish and Portuguese networks, Elliott had urged EDP to sell its Brazilian operation.

EDP, which reported a 53 percent fall in 2018 net profit on Monday due to tax and regulatory impacts in Portugal, said its investment plan should help it achieve a 7 percent compound annual growth rate in net profit over 2019-2022, and 5 percent annual growth in earnings before interest, taxes, depreciation and amortization (EBITDA).

As a result, net profit should finish 2022 above 1 billion euros and EBITDA would end that year above 4 billion euros, it said.

EDP shares were up 0.3 percent at 3.28 euros at 1212 GMT, just above the 3.26 euros per share offer Chinese state-owned CTG made for EDP last May. The bid by CTG, which is already EDP’s largest shareholder with a 23 percent stake, still requires various regulatory approvals before it can be formally launched.

In its home market and neighboring Spain, EDP plans to downsize its thermal and merchant power business. EDP’s operations in Portugal account for 90 percent of electricity generation and distribution in the country.

Reuters reported exclusively last week that EDP was working on a plan to sell some of its assets in Portugal.

The utility has been running an asset rotation program - selling some assets to buy others that may offer potentially higher returns - for a few years, mainly focused on wind power projects.

It said it expects to reduce its debt by 2 billion euros from end-2018’s 13.5 billion by 2022, when its net debt to EBITDA ratio should be less than 3 times, down from 4 times currently.

Nearly all of the planned investment will be in regulated assets and long-term power contracts to keep a low risk profile, EDP said.

In another nod to shareholders it promised to maintain an “attractive dividend policy” with a minimum 0.19 euros per share to be distributed, while raising the payout ratio to 75-85 percent by 2022 from 65-75 percent now.